Greece Promises Smoother-Running Solar Feed-In Tariff

Jeff St. John: January 20, 2009, 9:34 AM

The government of Greece last week announced changes to its solar feed-in tariff program, one of the most generous in Europe — and the biggest change they're promised is to make the program work.
That's according to Francesco D'Avack, analyst with New Energy Finance, who said Greece last week pledged to speed up a back-logged application process for its feed-in tariffs that has up to 3 gigawatts of solar power projects waiting for approval.
Launched in 2006, Greece's feed-in tariff offers from €0.40 to €0.50 (52 cents to 65 cents) per kilowatt-hour of solar power produced, D'Avack said — one of the most generous in Europe, where feed-in tariff prices tend to be in the range of 32 cents to 35 cents per kilowatt hour.
"Only no one can get it, because it's almost impossible to get the license," he said. The government in March completely stopped all new applications to work through the backlog, he said.
"The government now says they're going to take action on that" by setting new rules on application approval, though D'Avack warned that those rules must be backed by giving the agency responsible for application processing the resources it needs to fix the problem.
Feed-in tariffs are set prices at which utilities must buy power generated by renewable energy sources, giving them a boost against cheaper — and dirtier — sources of electricity.
Greece had about 24 megawatts of solar power installed as of December, of which 15 megawatts came in 2008, D'Avack said. That's far below the government's goal of 700 megawatts under the feed-in tariff program, which was changed from a cap on installations to a soft target in last week's program changes.
Greece also said it wants to establish a program this year to bring an additional 750 megawatts of solar rooftop installations to the country, though D'Avack said no concrete guidelines have been set.
Germany's feed-in tariff program has helped make the country the world leader in solar installations (see Solar Prices Set in Germany), and other European countries are also following the practice. Japan, which ended its solar feed-in tariff program in 2006, is now considering reinstating it, Reuters reported last month.
But not all the programs have run smoothly. In Spain, the government instituted a feed-in tariff in 2007 that had a hard cap on how many megawatts of solar power could apply for it — 400 megawatts at first, then raised to 500 megawatts in September.
But that was still far lower than the solar power projects installed in the country — up to 3.1 gigawatts in 2008, more than three times expectations, according to a recent government report (see Spain Installed More Than 3GW of Solar in 2008). And that, along with reports of fraud in the program, have crashed solar panel prices in the country (see Solar a Bust in Spain).
So far, feed-in tariffs haven't taken off in the United States, though a few exceptions exist. Gainesville, Fla. plans to launch a 32 cents-per-kilowatt hour feed-in tariff for solar power in March (see Gainesville to Launch Solar Feed-In Tariff) and California's Public Utilities Commission (CPUC) also approved a feed-in tariff program in early 2008, though it applies mostly to solar power systems at public water and wastewater facilities.